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About Assam Gas Cracker Project
New Delhi: May 9, 2003

The Government is keen to support the implementation of the Assam Gas Cracker Project. The cost of the project is estimated at Rs. 3600 crore. On finalization of the Feedstock Supply Agreement(s) and acquisition of land, the project authorities expect the project to be commissioned in 44 months.

A Letter of Intent was issued to the Assam Industrial Development Corporation (AIDC) on 25.1.1991 to set up a petrochemical Gas Cracker Complex with a capacity of 3 lakh tonnes per annum (TPA) Ethylene in the joint sector.

The foundation stone of the project was laid by the Prime Minister in November, 1994. A Committee constituted in the Department of Chemicals & Petrochemicals to monitor the implementation of the project assessed that gas for production of only 2 lakh TPA of Ethylene was available. It was agreed that Oil India Limited (OIL) would supply 5 Million Standard Cubic Meter Per Day (MMSCMD) of gas for the production of 1,30,000 TPA Ethylene and the Oil & Natural Gas Commission (ONGC) would supply 1.35 MMSCMD for the remaining 70,000 TPA of Ethylene. However, it is now estimated that with 1.35 MMSCMD of gas available from ONGC, it would be possible to produce only 28,000 TPA of Ethylene in the first 5 years and for the remaining 10 years, it would be sufficient to produce 15,000 TPA of Ethylene only. The Ministry of Petroleum and Natural Gas have identified Indian Oil Corporation (IOC) for supply of LPG to make up for the shortfall in the supply of gas.

With the passage of time, the price of gas has increased and subsidy to the oil companies will have to be given to provide gas at a confessional fixed rate of Rs. 600 per thousand cu. Meters of gas over a period of 15 years for the project, as decided by the Cabinet in 1994. Action has been initiated for the expeditious resolution of the issue of funds required for subsidy for the Assam Gas Cracker Project.

This information was given by the Minister of State for Chemicals & fertilizers, Dr. Chhattra Pal Singh, in a written reply to a question in the Rajya Sabha today.

Press Release by: PIB/AM/Hb
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